Project Costing and Control Budgets with Funding Source

You can establish funding sources, such as grants, donations, or endowments, and allocate amounts from those funding sources to multiple project budgets. When you perform budget checking on project transactions, the system checks the transaction amount against the sum of the allocations in the project budget.

Note:

Project budgets are created and posted in Project Costing. You can maintain hierarchies of project control budgets (such as between project budgets and phase budgets) by defining parent-child relationships and a projects translation tree.

See PeopleSoft Project Costing: Setting Up Budgets in PeopleSoft Project Costing.

Setting Up Project Budgets with Funding Source Control

To set up project budgets with funding source control, you define your funding sources, set up associated expenditure and revenue budgets, and allocate the funding sources to each project. Use the following setup procedure:

1. Establish Commitment Control ledgers and ledger groups for a project expenditure budget definition and a project revenue budget definition in the Detail Ledger and Ledger Groups components.

2. Define funding sources on the Funding Source Definition page.

   You enter funding source amounts and adjustments on the Funding Source Transaction Logs grid, and also descriptive information about the funding source. The page calculates the total funding source amount by aggregating the amounts that you enter on the grid.

3. Define a project expenditure budget definition in the Budget Definitions component:

   • Select the Enable Funding Source check box on the Control Budget Options page.

     By entering the revenue ledger group that you created in step 1 in the Revenue Track field on the same page, and after saving the expenditure budget definition, the system automatically creates the related revenue budget definition with the same parameters as the expenditure budget, except for the Commitment Control option, which is Track w/o Budget, and the excluded account types, which you must define. You can also add a second key ChartField to the revenue budget definition to further refine your identification of revenue sources.

   • Do not assign a budget period calendar.

   • You must enter the valid project ID values on the Control ChartField page and select or deselect the Funding Source Required check box for each.

     This alerts the system about whether a project is funding source-controlled. You can also enter the budget begin and end dates for the project.

4. On the Funding Source Allocation page, enter the overall amount approved for the project and then allocate funding sources and amounts for each project ID that requires funding source tracking.

   Each row on the Funding Source Allocation Details grid must have a unique funding source, even if the spend option is different.

   You can specify this allocation as a percentage or priority method. For the percentage allocation method, you can define funding source amounts as a percentage of the overall spending amount for the project or as a flat spending cap amount. For the priority method, assign each funding source a unique nonzero priority number. The system still saves the allocation with a zero priority number, but the Budget Processor cannot use this allocation because a funding source error is in effect for such cases. You also define whether a funding source amount can be spent immediately (budgeted), upon revenue being recognized or upon revenue being collected. For the recognized and collected revenue spending options, you define the percentage of revenue that can apply toward your project expenditure budget, up to the spending cap. The same revenue cannot be assigned to different funding sources. If more than two revenue rows exist, the secondary key identified in the revenue budget definition can be used to distinguish the revenue amounts.

   The following example presents funding source allocations for a project. Italicized values represent system-calculated amounts:

   Project ID	Funding Source	Spend Option	Spending Cap	% of Revenue	% of Overall Amount
   PROJ23	NIH0014	Budgeted	5000	NA	25
   PROJ23	UNIV17	Recognized	10000	75	50
   PROJ23	PRAT01	Budgeted	5000	NA	25

   In this example, the total spending amount for project ID PROJ23 is 20000, although the available spending amount at any given moment depends on the amount of revenue recognized from funding source UNIV17. The project can use up to 75 percent of the recognized revenue from funding source UNIV17, up to the 10000 spending cap. Fifty percent of the overall expenditure budget for the project comes from funding source UNIV17, 25 percent from NIH0014, and 25 percent from PRAT01.

   You can allocate funding sources to as many projects and business units as you prefer. The system validates that you do not over allocate a funding source.

5. Enter budget journals for budgeted funding source allocation rows.

   The Commitment Control Posting Process (FS_BP) Application Engine process validates that the funding source allocation is already defined and that the sum of the budget journal amount for one funding source does not exceed the spending cap defined on the Funding Source Allocation page.